"So this new approach of independent decision-making marks a real and important change and is another crucial step in helping Parliament to regain the trust of the public.

"The consultation we held over the autumn has been hugely informative and important in directing our thinking. It also serves to show the spread of views and depth of feeling on this issue."

Matthew Sinclair, chief executive of campaign group the TaxPayers' Alliance said: "Hiking politicians' wages at a time of pay freezes, benefit caps and necessary spending cuts would be completely unpalatable to taxpayers."

He said most people thought MPs' current salaries are "about right".

MPs have a funded final-salary pension scheme; they pay a fixed contribution and the Exchequer is liable for the balance.